Tik Tok has decided to completely ban the promotion of cryptocurrencies on its platform.
In fact, on the official page of their site dedicated to the Branded Content Policy they write:
“We prohibit promotion of […] financial Services and Products. All financial services and products are prohibited, including but not limited to lending and management of money assets, loans and credit cards, buy now pay later (BNPL) services, trading platforms, cryptocurrency, foreign exchange, debit and pre-payment cards, forex trading, commemorative coins, pyramid schemes (including non-financial services), investment services, credit repair services, bail bonds, debt assistance programmes, get rich quick schemes, debt consolidation services and penny auctions”.
With this policy update, it is de facto completely prohibited on the platform to promote any cryptocurrency and any crypto business.
Apparently, the decision was also made due to a warning from the UK FCA, which stated some time ago that there appear to be many young investors engaged in high-risk investments such as cryptocurrencies.
The FCA stated:
“The findings reveal there is a new, younger, more diverse group of consumers getting involved in higher-risk investments, potentially prompted in part by the accessibility offered by new investment apps. However, there is evidence that these higher-risk products may not always be suitable for these consumers’ needs as nearly two thirds (59%) claim that a significant investment loss would have a fundamental impact on their current or future lifestyle”.
Why TikTok bans cryptocurrencies
Given that almost half of all TikTok users are under the age of 30, it is possible that the company has decided to defend its users by blocking any crypto promotional activity, regardless of whether it is legitimate or not.
To be fair, the Chinese social network is not the first to take similar measures, as in the past Facebook and Google also decided to ban the paid promotion of anything to do with cryptocurrencies.
However, the decisions of Facebook and Google (i.e. YouTube) were first and foremost only about paid promotions, whereas TikTok’s decision may not be limited to sponsored content. The reason for this is that on the Chinese social network it is not always easy to distinguish which content is sponsored and which is not, whereas on Western platforms paid content is managed by the platforms themselves.
Moreover, the bans of Facebook and Google have been slowly removed over the years, while TikTok has just begun to fight against the promotion of crypto projects.
It has to be said that scams of various kinds have been literally blowing up on TikTok lately, also linked to various shitcoins, the price of which may have benefited considerably. However, users who can no longer promote crypto projects on TikTok may move to Instagram (owned by Facebook), where such sponsored content is still allowed.
Finally, it is necessary to underline that TikTok is a Chinese platform, and it is unlikely that this decision was taken at random this year, i.e. at the same time as China seems to have declared war on Bitcoin and cryptocurrencies, especially decentralized ones that cannot be controlled by the state.
In the long run, the decision to exit the crypto sector altogether could have a negative impact on the Asian country’s ability to innovate and evolve.